The Sensational Coins of Treasure Legends

Even though we don’t cut our coins up any more, the practice made an indelible cultural mark. Most of us still know the cost of a shave and a haircut is two bits (occasionally increased to six), and the piratical legend of “pieces of eight” still sounds like treasure. Pieces of eight, bits, and “cob” coins all have one thing in common: they could be subdivided when necessary by simply cutting them into pieces.

Pieces of Eight

The original silver peso could be cut into eight equal pieces each worth a single real. This made giving change easier in times of low circulation or when the coins were used in remote locations. Silver pesos (commonly called “Spanish dollars”) were one of the most widely-used coins international trade for centuries, due to their superior uniformity and milling standards. Some nations even countersigned the coin, legalizing it for use as local currency. Many coin denominations in Latin America used the silver peso as a base for their own currency, and the modern peso is still a common denomination in many of them. Over 20 nations still have a peso denomination, though the value has decreased over the centuries.

The pieces of eight of pirate legends refer more typically to the coins minted in the Americas and shipped to the Philippines aboard the Spanish treasure fleet. In the Philippines, these coins could be exchanged for Chinese goods, since Spanish silver was the only foreign currency accepted by the Chinese at the time. These coins, upon acceptance by Chinese merchants, would often be stamped with chop marks to indicate the coin had been valued correctly. (The later American trade dollars often ended up with chop marks, too. Read more here!)

A chest of these and other coins are rumored to lie buried under a quiet neighborhood in Philadelphia; a mysterious letter dated May 14, 1716 (verified as authentic) tells the recipient how to find a buried chest of “doubloons, pistoles, reales and pieces of eight.” Since the neighborhood has been built up over the centuries, it is impossible to access to spot where the chest is supposed to be buried. It might still wait to be discovered.

Doubloons

After Austria introduced the Guldengroschen coin in 1486, other countries began creating their own specie (high purity) coins. The Spanish 8-real coin, the peso, was created in 1497; 40 years later, they began producing the gold escudo, worth 16 reales, or 2 pesos. A later coin, the legendary doubloon, was worth 2 escudos (or 4 pesos, or 32 reales). Since it is also divisible by 8, the doubloon is also a “pieces of eight” coin.

Spanish-American mints also produced gold escudos in denominations of one, two, four, and eight. The two escudo coins were known as “pistoles,” with the eight escudo piece being a “quadruple pistole” or sometimes a “double doubloon.” In time, it became known simply as the Spanish doubloon. Doubloons were currency in Spain as late as the mid-19th century. In 1849, Spain minted its last doubloons; however, several former colonies, such as Mexico and Peru, continued to mint them.

Cob Coins and Creating Currency

In the British colonies, the word “cob” often referred to Spanish-American coins in either gold or silver, which were crudely shaped during the early years of exploration in the New World (in contrast to the coins minted in Spain, which were much more uniform.) The first mint in the Americas was established in Mexico City in 1535. A royal decree authorized Herman Cortes to “melt, cast, mark, and put aside the royal-fifth” of the precious metals taken from the Aztecsl; he set up the foundry in the palace of Axayacatl. The Casa de Moneda was officially established when the Queen of Spain signed the Viceroyalty of New Spain into existence on May 11, 1535. The mint began operations in April of 1536.

British colonists were usually prohibited by law from minting coins (with a few exceptions), and colonists often found themselves using Spanish coins. During the Revolutionary War, the new nation tried to implement paper currency, which quickly collapsed. (For fans of the musical “Hamilton,” this is referenced when the young aide-de-camp sings, “Local merchants deny us equipment, assistance, they only take British money, so sing a song of sixpence.”) Spanish dollars continued to be used as reliable currency; when cut into eight pieces, each 1-real piece was referred to as a “bit.” The United States established its own currency in 1792, with the creation of the US Mint, but the terms “two bits, four bits, six bits, a dollar” have remained in our vocabulary for over 200 years.Shortly after its founding in 1788, the New South Wales colony in Australia faced a shortage of coins. Not only was the colony remote from Europe, but most coins left the colony aboard trading ships, in exchange for their valuable cargo. Governor Lachlan Macquarie found an innovative solution: he had the centers punched out of thousands of Spanish dollars which the British government had sent. The inner piece (also called the “dump”) was valued at 15 pence, while the outer circle (colloquially known as the “holey dollar,”) was valued at 5 shillings. Each section was overstamped with the name of the colony, the date, and the new value of the coin. This not only doubled the number of coins in circulation, but made it almost impossible for them to be taken out of the colonies, since other colonies and countries would not accept the “damaged” coins. The relief was short-lived; the Sterling Silver Money Act passed by Parliament in 1825 ended the use of this uniquely Aussie currency.

Cob coinage faded into obscurity as minting technology and security measures have improved, but these unique coins and pieces of coins form an indelible part of our history.